The greedy rich have spent a trillion or two over the past 50 years to convince us that MMT is not true. They had too because it is true by definition. A financially sovereign government creates its own money.
Also, LLM AI is being force fed to us by greedy rich advertising. LLM AI will never be profitable in the standard business sense. Bernie and many others have been bamboozled and that can't end well if it persists.
There are a couple of problems with your thesis. First, you suggest that when we need money to fund things, the best thing to do is print more. There’s no consideration of the other side of the balance sheet, the growing deficit. Interest payments on the deficit have already exceeded the cost of Social Security. Deficits sacrifice tax dollars to pay investors who profit by lending us the money we print. Second, you seem to discount the power that 50% ownership of AI companies gives to the shareholders. Owners can regulate from the inside while legislators regulate from the outside. Third, the foundational argument you make is that we don’t want American citizens to adopt an “investor mindset.” So much water has gone under that bridge already that it’s difficult to know where to begin. AI is here, and it’s going to make trillions of dollars for its owners. Bernie’s proposal acknowledges that undisputed fact, and makes American citizens owners who both benefit from those profits and could use their ownership to leverage behavior change. In the meantime, we should, as you said, tax and regulate the bejesus out of them. I believe Altman’s interest is due to the fact that the proposal is powerful and seductive and he wants to control its impact, were it to come to fruition. The biggest danger in Bernie’s proposal is that it’s aimed directly at billionaire control and windfall profits they will, if allowed to do so, keep for themselves.
Look I don't want to rehash the entire MMT debate in a comment section but I encourage you to read more about the approach because you are caricaturing it inaccurately. They are very conscious of the dangers of money printing and view inflation as a constraint.
Also, the government does not need to be a shareholder in order to influence the behavior of companies. It can make laws and levy taxes, unlike you and me.
I don’t want to rehash the debate here, either. Part of me is very sympathetic and would love to see it adopted. Here is how Stephanie Kelton (I assume you know her writing) says MMT addresses inflation: “Of course, there are real limits to what can be done. No country can commit to large-scale infrastructure investment unless it has the available labor, machinery, concrete and, steel. Trying to spend too much will cause an inflation problem. The trick is to adjust the budget to make efficient use of the people, factories and raw materials we have.” That “trick” means - in a Democracy divided ideologically and politically - politicians (and I have been one) would need to cut spending and raise taxes to address deficit-caused inflation. It’s not clear to me how MMT would address that pragmatic challenge. Bernie’s proposal is a real-world intervention designed to address the political challenges of the moment. In this political moment, MMT seems more pie-in-the-sky theology than economics.
I have a fundamental question that I don't see clearly answered anywhere about this. Is Bernie proposing we BUY half the equity in these companies, or that we effectively NATIONALIZE half the equity? I've seen people assume the former, but the latter is a more palatable idea (though I also oppose it).
I also agree with your basic take. Imo, the biggest downside from AI is its potential hit to employment, both generating unemployment and deskilling. This attacks the bargaining g power of labor. I am still not sure if this threat is real given the wads of hype surrounding AI (see especially Cory Doctorow on this) but it is a potential problem. Interestingly it is a problem with a pedigree solution from some old FDR democrats; the Humphrey Hawkins full employment bill. One way of mitigating the obvious downsides of AI is via a gvmt guarantee of a good paying job. There cant be unemployment or underemployment if we dont want it. We can legislate it away. And having a guaranteed tight job market is good for labor, always. Note, btw, with this problem “solved” (sarc!) we will also all enjoy the benefits of increased productivity from AI should any arise (no evidence of this to date). The (inflated) promises/threats of AI can be converted to gains for us all if we eliminate the obvious downsides. After all, who could object to eliminating crappy jobs? If AI can do this and people move from crap jobs to good ones isnt that good? The threat is that this wont happen if AI delivers productivity. We need policies that address this head on, not sideways via investment funds. And as luck should have it, we have one waiting in the wings. ,ets revive a (even better) version of Humphrey-Hawkins.
I totally agree with you. But getting the left to truly regulate anything anymore feels like getting a chicken to produce milk. Except for a precious few, they have been SO complacent all through this nightmare we are all living, I just can't see them having the cojones to try to regulate AI. I hope I'm wrong.
The greedy rich have spent a trillion or two over the past 50 years to convince us that MMT is not true. They had too because it is true by definition. A financially sovereign government creates its own money.
Also, LLM AI is being force fed to us by greedy rich advertising. LLM AI will never be profitable in the standard business sense. Bernie and many others have been bamboozled and that can't end well if it persists.
There are a couple of problems with your thesis. First, you suggest that when we need money to fund things, the best thing to do is print more. There’s no consideration of the other side of the balance sheet, the growing deficit. Interest payments on the deficit have already exceeded the cost of Social Security. Deficits sacrifice tax dollars to pay investors who profit by lending us the money we print. Second, you seem to discount the power that 50% ownership of AI companies gives to the shareholders. Owners can regulate from the inside while legislators regulate from the outside. Third, the foundational argument you make is that we don’t want American citizens to adopt an “investor mindset.” So much water has gone under that bridge already that it’s difficult to know where to begin. AI is here, and it’s going to make trillions of dollars for its owners. Bernie’s proposal acknowledges that undisputed fact, and makes American citizens owners who both benefit from those profits and could use their ownership to leverage behavior change. In the meantime, we should, as you said, tax and regulate the bejesus out of them. I believe Altman’s interest is due to the fact that the proposal is powerful and seductive and he wants to control its impact, were it to come to fruition. The biggest danger in Bernie’s proposal is that it’s aimed directly at billionaire control and windfall profits they will, if allowed to do so, keep for themselves.
Look I don't want to rehash the entire MMT debate in a comment section but I encourage you to read more about the approach because you are caricaturing it inaccurately. They are very conscious of the dangers of money printing and view inflation as a constraint.
Also, the government does not need to be a shareholder in order to influence the behavior of companies. It can make laws and levy taxes, unlike you and me.
I don’t want to rehash the debate here, either. Part of me is very sympathetic and would love to see it adopted. Here is how Stephanie Kelton (I assume you know her writing) says MMT addresses inflation: “Of course, there are real limits to what can be done. No country can commit to large-scale infrastructure investment unless it has the available labor, machinery, concrete and, steel. Trying to spend too much will cause an inflation problem. The trick is to adjust the budget to make efficient use of the people, factories and raw materials we have.” That “trick” means - in a Democracy divided ideologically and politically - politicians (and I have been one) would need to cut spending and raise taxes to address deficit-caused inflation. It’s not clear to me how MMT would address that pragmatic challenge. Bernie’s proposal is a real-world intervention designed to address the political challenges of the moment. In this political moment, MMT seems more pie-in-the-sky theology than economics.
Doug Henwood is good on this: https://jacobin.com/2019/02/modern-monetary-theory-isnt-helping
Bernie's losing his fastball, man. At some point, he's gotta pass the torch and put himself out to pasture.
“Money is just an accounting tool” is MMT nonsense.
Or, like, an obvious fact.
I have a fundamental question that I don't see clearly answered anywhere about this. Is Bernie proposing we BUY half the equity in these companies, or that we effectively NATIONALIZE half the equity? I've seen people assume the former, but the latter is a more palatable idea (though I also oppose it).
Nationalize. Which is certainly better than buy, but still leaves the issues discussed above.
I also agree with your basic take. Imo, the biggest downside from AI is its potential hit to employment, both generating unemployment and deskilling. This attacks the bargaining g power of labor. I am still not sure if this threat is real given the wads of hype surrounding AI (see especially Cory Doctorow on this) but it is a potential problem. Interestingly it is a problem with a pedigree solution from some old FDR democrats; the Humphrey Hawkins full employment bill. One way of mitigating the obvious downsides of AI is via a gvmt guarantee of a good paying job. There cant be unemployment or underemployment if we dont want it. We can legislate it away. And having a guaranteed tight job market is good for labor, always. Note, btw, with this problem “solved” (sarc!) we will also all enjoy the benefits of increased productivity from AI should any arise (no evidence of this to date). The (inflated) promises/threats of AI can be converted to gains for us all if we eliminate the obvious downsides. After all, who could object to eliminating crappy jobs? If AI can do this and people move from crap jobs to good ones isnt that good? The threat is that this wont happen if AI delivers productivity. We need policies that address this head on, not sideways via investment funds. And as luck should have it, we have one waiting in the wings. ,ets revive a (even better) version of Humphrey-Hawkins.
I totally agree with you. But getting the left to truly regulate anything anymore feels like getting a chicken to produce milk. Except for a precious few, they have been SO complacent all through this nightmare we are all living, I just can't see them having the cojones to try to regulate AI. I hope I'm wrong.